Title insurance protects the insured from a financial loss related to the ownership of a property. There are two policies involved in a home loan closing. The first is the lender’s policy, which is required, and the second is the owner’s policy.
Both are a one-time, upfront cost that will be included on the settlement statement to be collected at closing, not a monthly premium that will be added to your mortgage payment.
What Is A Clear Title?
When you are in the home buying process, a title company will check for “clear title.” A clear title is a title without any type of lien from creditors or other parties that would pose a question as to legal ownership.
For example, an owner of a home with a clear title is the sole owner, and no other party can make any kind of legal claim to its ownership. Title insurance protects you from anything that might have been missed.
Some common examples of title issues are:
- Title forgeries
- Back taxes
- Filing errors
- Unknown heirs to the estate who claim ownership
- Inconsistent or conflicting wills
- Liens, commonly from unpaid home equity lines of credit (HELOCs) or contractor bills
- Undocumented easements
Here are a few other articles and blogs that go into more detail on title insurance and some of the issues you can run into. We suggest that you familiarize yourself with the concept, and of course, call us at Blink if you have any questions, and we’ll happily help walk you through the process.
Title Insurance: What Does It Cover and Do I Need It? | Zillow (received information above from this website)
A super easy read breaking down what title insurance is, and why you need it from Forbes below:
Check out our friends at Fidelity National Title and see their 21 reasons for Title Insurance 😊